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All You Can Eat Buffet

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Submitted By ludyy13
Words 252
Pages 2
Ludibina Rivas
ECON 2302
Spring 2015

Course Learning Outcome #3 Activity

Restaurant are willing to offer all you-can-eat buffet meals and still make money from customers because of the law of diminishing marginal utility. This law states that the more of a good you consume per period, the smaller the increase in your additional consumption (McEachern). This is what helps restaurants make money from buffets. When a person goes into a restaurant that offers a buffet they are ready to eat as much as they can. They well instantly enjoy their first plate thinking they want to keep eating more and are making their money worth. As soon as they serve their second plate they have two factors that will affect if they are going to go for that third plate. First thing would be that they aren’t going to enjoy that second plate as much as the first, so it wouldn’t want to make them go for a third plate. The second factor would be by the time they finish that second plate most people get full. If they serve themselves that third plate, while being full they are not going to get anymore satisfaction from the meal. So yes, restaurants do gain profit from all you-can-eat buffets. Due to the fact that they attract more people thinking they are going to eat as much food as they want for one price.

Works Cited
McEachern, William A. ECON-Principles of Microeconomics. 4th. Stamford: Cengage Learning, 2014.

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